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Weekend Economists Thanksgiving Leftovers November 29-30, 2014
Hard to believe another month is over. Even with my drastically reduced workload, the time flies by. Of course, I've only had a couple of weeks, so far, on the new schedule; not even enough to get the bugs out. And it is the season of rehearsals, performances and spectacles.
I actually did shop one store (at dinner time) on Black Friday. They reported steady, but not overwhelming traffic. And it snowed enough to make life interesting and slippery when we went to the movies:
We went to see "White Christmas", with Crosby, Kaye, Clooney and Vera-Ellen. Our local Michigan Theater, a 1927 Picture Palace lovingly restored, likes to host fun-filled singalong spectacles. We had goody bags, with Santa hats, a blue feather (for the fan dance) a horse for the knight-on-a theme, and these clever slapstick clappers and a candy cane, and sang a bunch of commercial Christmas songs (not carols) before the show with organ accompaniment on the recently restored Barton's pipe organ, which is original to the theater. It even has the tweeting bird feature from the silent film time...
The film itself, released 60 years ago, is creaky...it starts in WWII and lumbers forward. The acting is uneven, the plot ridiculous, and we had fun. It was rather like the Rocky Horror Picture Show, without the toast. The Kid enjoyed it, which is what was important.
One of the plot twists is that the unseasonable weather (in the 60F region) has left Vermont green and snowless....proving that New England weather has been capricious for some time...I spent one Thanksgiving in a convertible with the top down, and no coat...and another shovelling out that completely buried convertible...
The Kid also enjoyed "The Penguins of Madagascar", which I felt didn't live up to the previous Madagascar films. You have been warned...
This is the sequel to the earlier WEE thread, which got too long...keep on posting!
31 replies
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= new reply since forum marked as read
http://moslereconomics.com/2014/11/28/personal-income-and-consumption-charts-and-comments-and-a-word-on-oil/
This is after tax personal income not adjusted for inflation. Note that there was anticipation of an acceleration from the first quarter, but now it looks like the growth has slowed and rolled over:
Here you can see how it was growing steadily, then shifted down when my payroll tax holiday expired, sort of resumed growing at the same rate, and now may be falling off, even with what the mainstream call ‘solid’ payroll growth:
Likewise, there’s been a lid on the growth personal consumption expenditures where the growth rate dipped for the cold winter, recovered, and then fell off some:
Adjusted for inflation/cpi the pattern is the same:
Oil- Not all that much to it. The Saudis remain price setter as a simple point of logic.
No telling what their price target may be at any time, but they simply set price for their refiners and let them buy all they want at that price. And no one else has the excess capacity to do that.
Possible motives?
Put high priced producers out of business with $trillions of losses to make sure that when they subsequently raise prices to 150(?) new investment in high priced crude will then be considered to risky for anyone to finance? And/or it’s not illegal for insiders to have gotten short for their personal accounts prior to the price cuts and subsequently covering prior to increasing prices, functionally transferring a bit of wealth from the state to private accounts?
Ramifications for the US:
US consumers helped a bit- about $100 billion/year last I heard? Capex gets hurt by at least that much? Trillions in value lost from loans and investments going south? Thousands of high paying jobs lost in North Dakota, etc. due to reduced capex? (EU not so much as they don’t invest nearly as much in high priced energy exploration/production?) Canada, Mexico, Venezuela, Australia etc. economies and related securities/investments toast?
etc.
This is after tax personal income not adjusted for inflation. Note that there was anticipation of an acceleration from the first quarter, but now it looks like the growth has slowed and rolled over:
Here you can see how it was growing steadily, then shifted down when my payroll tax holiday expired, sort of resumed growing at the same rate, and now may be falling off, even with what the mainstream call ‘solid’ payroll growth:
Likewise, there’s been a lid on the growth personal consumption expenditures where the growth rate dipped for the cold winter, recovered, and then fell off some:
Adjusted for inflation/cpi the pattern is the same:
Oil- Not all that much to it. The Saudis remain price setter as a simple point of logic.
No telling what their price target may be at any time, but they simply set price for their refiners and let them buy all they want at that price. And no one else has the excess capacity to do that.
Possible motives?
Put high priced producers out of business with $trillions of losses to make sure that when they subsequently raise prices to 150(?) new investment in high priced crude will then be considered to risky for anyone to finance? And/or it’s not illegal for insiders to have gotten short for their personal accounts prior to the price cuts and subsequently covering prior to increasing prices, functionally transferring a bit of wealth from the state to private accounts?
Ramifications for the US:
US consumers helped a bit- about $100 billion/year last I heard? Capex gets hurt by at least that much? Trillions in value lost from loans and investments going south? Thousands of high paying jobs lost in North Dakota, etc. due to reduced capex? (EU not so much as they don’t invest nearly as much in high priced energy exploration/production?) Canada, Mexico, Venezuela, Australia etc. economies and related securities/investments toast?
etc.
http://www.businessinsider.com/oil-production-breakeven-prices-2014-11
Among the factors Morse cited for why a production cut was unlikely is that Saudi Arabia has enough cash on hand to withstand the decline in oil prices so far.
And following OPEC's announcement on Thursday, Russian oil CEO Igor Sechin said that Russia could withstand a drop in crude prices to $60 a barrel.
Russia is not an OPEC member.
And so as oil prices continue to tumble a number of countries that rely on oil exports to balance their budget will certainly miss this goal in 2014, a few countries really stand out.
Iraq, Iran, Algeria, and Yemen never saw oil prices get above their breakeven price for more than just a few days in 2014.
But Libya looks like it never had a chance.
Read more: http://www.businessinsider.com/oil-production-breakeven-prices-2014-11#ixzz3KSn6nklB
Among the factors Morse cited for why a production cut was unlikely is that Saudi Arabia has enough cash on hand to withstand the decline in oil prices so far.
And following OPEC's announcement on Thursday, Russian oil CEO Igor Sechin said that Russia could withstand a drop in crude prices to $60 a barrel.
Russia is not an OPEC member.
And so as oil prices continue to tumble a number of countries that rely on oil exports to balance their budget will certainly miss this goal in 2014, a few countries really stand out.
Iraq, Iran, Algeria, and Yemen never saw oil prices get above their breakeven price for more than just a few days in 2014.
But Libya looks like it never had a chance.
Read more: http://www.businessinsider.com/oil-production-breakeven-prices-2014-11#ixzz3KSn6nklB
http://dealbook.nytimes.com/2014/11/27/u-s-backed-mortgages-put-to-test-in-a-lawsuit/
When Hayward Ferrell of Huber Heights, Ohio, fell behind on his mortgage payments several years ago, his bank did not meet with him to try to work out a plan to make the loan easier to pay, he says.
“They never sat me down and said, ‘It looks like you are going to lose this, so why don’t you do this?’ ” he said. “They never did that.” The lender, U.S. Bank, foreclosed on the house in 2009.
Not engaging with borrowers who have missed payments may not seem like the strongest grounds for litigation against a bank. Yet that is the basis for an innovative lawsuit against U.S. Bank, a division of U.S. Bancorp, one of the largest banks in the country. The legal action could mean fresh legal problems for other big mortgage banks, as well. It is the latest threat to emerge from a barrage of cases that have forced big banks to pay tens of billions of dollars in recent months.
The lawsuit focuses on a popular type of government-guaranteed mortgage that in fact requires that banks take distinct steps — like trying to arrange a meeting — when borrowers stop paying...
!
When Hayward Ferrell of Huber Heights, Ohio, fell behind on his mortgage payments several years ago, his bank did not meet with him to try to work out a plan to make the loan easier to pay, he says.
“They never sat me down and said, ‘It looks like you are going to lose this, so why don’t you do this?’ ” he said. “They never did that.” The lender, U.S. Bank, foreclosed on the house in 2009.
Not engaging with borrowers who have missed payments may not seem like the strongest grounds for litigation against a bank. Yet that is the basis for an innovative lawsuit against U.S. Bank, a division of U.S. Bancorp, one of the largest banks in the country. The legal action could mean fresh legal problems for other big mortgage banks, as well. It is the latest threat to emerge from a barrage of cases that have forced big banks to pay tens of billions of dollars in recent months.
The lawsuit focuses on a popular type of government-guaranteed mortgage that in fact requires that banks take distinct steps — like trying to arrange a meeting — when borrowers stop paying...
!
Thanksgiving Travel? Vermont Turkeys Used To Walk To Boston
During traditional turkey drives to Boston, children of Vermont farmers typically walked with the turkeys, scattering food to lure them forward -- but perhaps they would have appreciated wagon rides.
..."Turkey drives" were an autumnal tradition from the 1800s to the early 1900s, and involved the overland strolling of flocks of turkeys from all corners of Vermont to their destination — and demise — in Boston.
"We're talking about thousands of turkeys in each trip ... Up to 10,000," Peter Gilbert, chair of the Vermont Humanities Council, tells Vermont Edition. "One of the largest drives in the fall of 1824 involved 40 homesteads ... They went all the way from northern Vermont and the Canadian border by a variety of routes, through Ferrisburgh in the west, down the Connecticut River in the east."
THOSE CONNECTICUT RIVER TURKEYS MUST HAVE BEEN GOING FOR NYC...
Farmers' children often acted as drovers, scattering cracked corn in the turkeys' path to coax them along the route. And the route wasn't always smooth:
The going was slow, Gilbert says — just 10 to 12 miles a day — and not without casualties. "They lost a lot of turkeys on the way — maybe 10 percent of them were drowned in river crossings or taken by foxes or died of natural causes. And one of the natural causes would be ... farmers’ families. As the turkeys walked by the farm, a couple of them might lose their way into a pot in the farm family’s kitchen."
MORE HISTORICAL GLIMPSES AT LINK
During traditional turkey drives to Boston, children of Vermont farmers typically walked with the turkeys, scattering food to lure them forward -- but perhaps they would have appreciated wagon rides.
..."Turkey drives" were an autumnal tradition from the 1800s to the early 1900s, and involved the overland strolling of flocks of turkeys from all corners of Vermont to their destination — and demise — in Boston.
"We're talking about thousands of turkeys in each trip ... Up to 10,000," Peter Gilbert, chair of the Vermont Humanities Council, tells Vermont Edition. "One of the largest drives in the fall of 1824 involved 40 homesteads ... They went all the way from northern Vermont and the Canadian border by a variety of routes, through Ferrisburgh in the west, down the Connecticut River in the east."
THOSE CONNECTICUT RIVER TURKEYS MUST HAVE BEEN GOING FOR NYC...
Farmers' children often acted as drovers, scattering cracked corn in the turkeys' path to coax them along the route. And the route wasn't always smooth:
"Remember, in 1824 the roads were not very good," Gilbert says. "Sometimes they were just paths, sometimes they made their way across fields. Sometimes they had wagons, but this was a primitive and challenging trip."
The going was slow, Gilbert says — just 10 to 12 miles a day — and not without casualties. "They lost a lot of turkeys on the way — maybe 10 percent of them were drowned in river crossings or taken by foxes or died of natural causes. And one of the natural causes would be ... farmers’ families. As the turkeys walked by the farm, a couple of them might lose their way into a pot in the farm family’s kitchen."
MORE HISTORICAL GLIMPSES AT LINK
http://www.washingtonpost.com/blogs/the-fix/wp/2014/11/19/heres-why-democrats-couldnt-run-on-the-economy-in-2014/
...The economy, after all, is what voters almost always say is their top priority. And Democrats had to be heartened to see eight straight months of more than 200,000 jobs created prior to Nov. 4, an unemployment rate dipping below 6 percent, and a thriving stock market.
The economic picture in the homes of Americans, though, was a far different one. In fact, despite progress at the macro level, Americans' views of their own families' economies were basically unchanged -- even from the doldrums of the economic recession. The chart below tells the tale as well as anything we've seen....
You'll notice that one of these lines slopes upward. The other one -- the one that actually matters when it comes to actual votes -- does not.
The macro number (in red) is up to an average of 29 which, while not good, is still better than the single digits in the earliest days of the recession. It's progress. The personal-finance number, though, as of late October, was stuck at an average of 51. Back at the end of 2009, it was 50, and the lowest it ever got was 44. That's not progress...Even Obama, while trying to pump up the economic progress during his presidency, acknowledged this uneasy dichotomy. "They don't feel it," Obama said of the economic progress he believes his Administration had made in a "60 Minutes" interview in late September. "And the reason they don't feel it is because incomes and wages are not going up."
In the end, this was a big reason Democrats didn't have something to run on in 2014. And without a cogent argument for the success of the Obama Administration, their voters were left unmotivated and their candidates were left twisting in the wind.
...The economy, after all, is what voters almost always say is their top priority. And Democrats had to be heartened to see eight straight months of more than 200,000 jobs created prior to Nov. 4, an unemployment rate dipping below 6 percent, and a thriving stock market.
The economic picture in the homes of Americans, though, was a far different one. In fact, despite progress at the macro level, Americans' views of their own families' economies were basically unchanged -- even from the doldrums of the economic recession. The chart below tells the tale as well as anything we've seen....
You'll notice that one of these lines slopes upward. The other one -- the one that actually matters when it comes to actual votes -- does not.
The macro number (in red) is up to an average of 29 which, while not good, is still better than the single digits in the earliest days of the recession. It's progress. The personal-finance number, though, as of late October, was stuck at an average of 51. Back at the end of 2009, it was 50, and the lowest it ever got was 44. That's not progress...Even Obama, while trying to pump up the economic progress during his presidency, acknowledged this uneasy dichotomy. "They don't feel it," Obama said of the economic progress he believes his Administration had made in a "60 Minutes" interview in late September. "And the reason they don't feel it is because incomes and wages are not going up."
In the end, this was a big reason Democrats didn't have something to run on in 2014. And without a cogent argument for the success of the Obama Administration, their voters were left unmotivated and their candidates were left twisting in the wind.
It went very well, and people stayed to clean up. The turkey and all is nearly gone, enough for a sandwich or two. Everything tasted good, and I am stuffed.
And so too this thread has come to its end. Thanks for participating! See you on SMW 